Question
Amber consumes good 1 and good 2. Her demand for good 1 is given by 1(1,2,)= 2/51 . Her income is $1500 per month. Currently,
Amber consumes good 1 and good 2. Her demand for good 1 is given by 1(1,2,)= 2/51 . Her income is $1500 per month. Currently, the price of good 1 is $3 and the price of good 2 is $1. If the price of good 1 rises to $4, how will her demand for good 1 change? (Calculate the number of units of good 1 demanded before and after the price increase.) What will be the substitution effect and the income effect of the price increase?
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Principles of Accounting
Authors: Belverd E. Needles, Marian Powers and Susan V. Crosson
12th edition
978-1133603054, 113362698X, 9781285607047, 113360305X, 978-1133626985
